tv Bloomberg Markets Bloomberg September 23, 2015 11:00am-2:01pm EDT
company? regaining the trust of u.s. consumers. we will discuss both of the issues. scarlet: instagram conquers the here andth the users overseas. cory johnson gives us a snapshot of the success. china's president tours the pacific northwest, we will have a live report from seattle with the latest. ♪ alix: breaking news. the ceo of volkswagen is going to resign coming out just now. says he requested the step down and he is stunned that the misconduct happened in volkswagen on such a scale. we continue to get headlines. he is not aware of wrongdoing on his part. the live shot is where we will hear from the ceo.
scarlet: this is coming from a statement, so he has not yet come out to speak to the press just yet. dutyys he does except the and was requested to step down, pressuregiving in to presumably from the board. you mentioned that he is not aware of wrongdoing on his part and the company needs a fresh start. he is stepping down and resigning as ceo to depart from folks like him. alix: this is a stunning development. folkskorn is convinced like and will recover and accept responsibility for irregularities despite the fact that he does not hold himself responsible. ryan chilcote joins us from london who was going over the the headlines. this is a stunning development. ryan: it is stunning.
looking at the share price up 7.69%, best-performing stock on the dax. it has been rising all day. no real demand a change in the share price. when we got the news from this statement, the ceo martin , lost nearly 600,000 people -- balky nearly 600,000 people but there probably was anticipation that he might go when he went into the meeting with the executive committee of the supervisory board. sitting down with the five members of the executive committee saying, he just revealed it would be a good idea for him to step down and he agreed to step down. the stock up 7.7% does not tell the whole story. what does is if i do up the six-month because you will see share prices down by more than 50% over the last six months and by more than 35% in the last three days alone.
this has been a huge scandal, huge liability and overhang on the stock. now we have seen martin winterkorn, the ceo of folks like an -- volkswagen stepping down. scarlet: we are waiting for live comments but we do have hans nichols joining us from berlin. martin winterkorn to come out with a video statement yesterday and i know you were listening to it and monitoring it. the takeaway seemed to be that he was holding firm and do not want to make moves just then. what you think transpired between yesterday and today? meetings with five people on the board, normally six, of the five people, he did not apparently have enough support to go on to the full board which was always expected to extend his contract as of last week on friday, he was supposed to give his two-year contract extension for 2018 four action printer corgi was folks like in his entire
life and this last week has been a stunning turnaround. it has been remarkable and what he says is he is resigning in part because he is accepting personal responsibility and he is not saying he has done anything wrong but he thinks the new ceo should have a cleaner slate to move forward, rebuild the company and that rebuilding will have two parts. one will be focused on the legal litigation and the hurdles and the second will be the technical challenges of how you fix this problem. martin winterkorn thought he could do the technical side and that is clear but looks like the board did not have the confidence that he could do the second part which is termed a brand around. now we have to figure out who the next ceo is. 50 candidates we think are close our herbert, he recently came over from bmw and he is running thenolkswagen brand and the ceo of porsche. one thing about porsche, they sold about 190,000 vehicles last
year. the volkswagen group sold 10 million vehicles. that being said, when you look at porsches profit, they had 3 billion of profit last year. the volkswagen brand had about 2.5 million. the figure with porsche, they are going with a luxury profit center. alix: stay with us. we also want to bring in matt miller. is this enough? is this going to be enough to help the stock and help them recover? matt: i think in the short-term it will help the stock a little bit. i'm not sure how much this all help in the long term. it really depends on what they do as far as turning around the business and taking out the people that were responsible for it, installing people who have no connection to it. i mean, you talk about porsche, miller, volkswagen, although hans points out becomes it from
bmw, it will still be interesting to see how they do if they do not install someone completely untainted by this scandal. i will say that this was clearly expected and maybe one of the reasons behind the game that we saw on the shares today, even martining out and saying winterkorn needed to go and you have analysts saying the same, so maybe that is why you saw a bigger game this morning then you are seeing now. looks i shares have come down a bit. they were up about 8% and now up about 6.8%. it seems that this was widely expected over the last couple of days. i'm sure this is the first step they need to recover. now they need to find out who is really responsible and how they can change and fix it. and how much it will cost. the cost is one of the biggest aspects. if you consider the fact that ethics, i know you were talking
to a guest saying the same thing, a six could make the car performed worse or could ruin the miles per gallon that you are already getting as an owner in the cars. a lot of consumers are not going to want to bring the car in for a six. a lot will not want to bring the car in for a refund and they will -- a lot will want to bring the car in for a refund and the cost is unimaginable. far beyond the $7.3 billion a have set aside. alix: looks like the press conference is just about to start. we will hear from professor mark victor korn and we'll see if it is in english. matt: he will likely speak german. alix: we are going to keep on walking -- watching for headlines that cross on the news conference. to matt's point, deutsche bank came out with a note saying that they were kind of holding the stock. scarlet: an obvious point to downgrade the stock. alix: they did the work earning
35% due to the ongoing crisis in the cost, meaning it is not as simple as putting out the person at the top. this is a systemic and long-term issue. scarlet: especially given the fact that martin winterkorn points to a culture within the company that perhaps needs to be addressed. matt miller has been way on top of this in terms of the company's political ties. you have talked about how lower stocks hold a 20% stake in the company and the union owns another steak and angela merkel has spoken as well. one out of seven jobs is tied to the auto industry in germany, so huge political ramifications. don't hold aons substantial stake in the company, but they do have members sitting on the supervisory board. in germany, it is typical to have labor unions sitting on the supervisory boards to help guide the company making decisions, such as whether or not the ceo stays or goes and which one
comes in. it not only holds the 20% stake but it also has a block a vote, so it can veto any decisions that is made by the majority shareholders which is the porsche family. becausepeace family they are the same, peeche, his fraternal grandfather control 51% of the company, but any decisions they make could be this.d by it is a very political decision. you say one in seven people have jobs in the auto industry, well, the entire town of wolfsburg was built for volkswagen, so the whole town is colleges, schools, museums, businesses. they rely on volkswagen for and financialort employment. it is a really big deal in germany and that is why they want action to be swift and definitive, so it will be
interesting to see who they put in and who they install as ceo and whether or not he has connections to the company already. stuff and great context. just to reiterate headlines, folks like and ceo martin winterkorn is stepping down -- volkswagen ceo martin winterkorn is stepping down. this is the board of the company speaking and this takes place in german, so we are not giving you the live broadcast just yet. we are waiting for translation. previously, we note that in a statement released by the company, victor koren said the company needs a fresh start by stepping down, he is clearing the way for the fresh start. alix: he does accept responsibility for irregularities but is unaware of any wrongdoing on his part. will take the bullet but he is still saying it is not his fault. scarlet: hans nichols, i know you are all your volkswagen is based, part of the town's
fabric, tell us what you plan to look for when you go there. who do you plan to speak with and what you hope to discover? hans: i think the most important question is who is going to lead folks fog and. the porsche ceo is among the two candidates and one source familiar said he could replace martin winterkorn if he goes. i think the key question for shareholders and everyone is coded a select to be the ceo? andert came up through bmw he is a bmw got. if you want a fresh start, go with herbert. if you want someone that knows the volkswagen and porsche family, you go with the ceo of porsche. what mohler has going for him, he probably has a backing and he has it from the porsche family. as matt pointed out, it is a complicated process. you have the porsche family,
legendary figure in german auto circles, he founded the company and then he has got his shareholders family members descendents. council,have the works a carpal union basically organization, and that 20% stake in lower which is the state where full is based. the other important thing is maybe go to on over and talk to the political leadership there and ask them whether or not they think mattea's mohler is an acceptable replacement. if they sign off and the porsche family is poor, the next ceo is mohler. scarlet: they will be dotting their i's and crossing their t's. out rightnes coming now. they are said to have proposals on the ceo successor by friday. originally, we thought that martin winterkorn would be getting the contract renewed friday but they plan to have a proposal on the new successor on friday. they also seek further changes in the next couple of days.
they also added the damage done cannot be measured. alix: this is like bloom, boom, boom. they're getting it done and setting up a timetable. ryan chilcote joins us from london. theust heard hans cap about potential for the porsche ceo to become the volkswagen ceo. what does your research tell you? ryan: it is possible you see amongst the people standing at the microphone, porsche controls the family estate that has the majority of the voting shares. a hand in who becomes the successor to martin winterkorn. there wereard -- challenges to martin winterkorn earlier in the year that were unsuccessful. i want to give you the perspective of shareholders today in the stock. funny enough, ever since it became clear that martin winterkorn is going to step down, when he issued the statement and now that we get
that press conference from the members of the executive committee that he will step down, the shares have actually come down a bit because they have had such a great day. i think in part it is anticipation that it was going to come to this. that martin winterkorn, the boss for eight years now i've volkswagen boss of 600,000 people who has really been an entity in the industry would finally have to step down because the pressure has been so extraordinary. volkswagen in various points today has been the best-performing stock on the dax and also one of the most volatile. just a really extraordinary day. close to 10 million shares, just to give you an idea. that is five times the daily average over the last six months. this has been a stock people want to buy and sell like mad in europe today. and this is a point we heard from matt miller, that will not change. i have tonk about it,
bring of the six months again. just in the last three days, the shares will come down. look at that did. i'm more than 35%. a huge setback for volkswagen. people talking about this creating the same overhang on the stock like bp had when they got its troubles with the gulf spill. 6%, the share price rise is just at the beginning of the rehabilitation of volkswagen which could take years. thank you so much. ryan chilcote joining us from london as well as hans nichols. thank you for your reporting. headlines keep crossing. scarlet: matt miller will be joining us shortly but i wanted to recap headlines because the press conference has ended. what we have learned is that martin winterkorn is resigning as ceo of volkswagen. headlines indicate that they are moving ahead and plan to have some ceo proposals by friday. thathave also indicated
they filed or they will file a criminal complaint on request of the supervisory board and an internal probe is in full swing. states inn, lower germany are looking to start an investigation into this manipulation and says criminal charges may be sought as well. they added the investigation could take a long time before criminal charges are filed but that is the intent. atx: just taking a look broad indicator of the stocks. you have the 600 index timing higher as the announcement came out. is off of those highs, but also taken a look at other stocks, a quick look at some of bloomberg terminal, this is one of, one of the most exposed auto suppliers tell folks find him back at over 10%. seeresting to know, you can the valley, as we saw the announcement started to go out, you are now seeing warner around
alix: you are watching bloomberg "market day scarlet:. so we have been covering the resignation of martin winterkorn. we will have more on that later on but i wanted to briefly mention that stocks in the united states are at their session lows. if you take a look inside the bloomberg terminal, you can see them a leg lower. thisurse, we need to put in context. these are not exactly huge moves. the s&p 500 is only off by .5 of 1% and the doubt jones is down
5.3 of 1%. so these are not the moves. -- big moves. it is confusion on what the fed alix: does next. our top story is volkswagen announcing martin winterkorn boat step down. the supervisory board was just speaking in a news conference saying that elicit action may overcomingprime of this crisis as a long-term task. the board is going to form an investigative committee and it does support prosecutors probe. martin winterkorn saying he is taking responsibility but he is not saying he did anything wrong. scarlet: matt miller is our resident expert on the auto industry and you are watching closely as this unfolds. what is your take? it seems like what we are getting, they are getting it done. they will name a successor perhaps friday and are taking responsibility.
that is different from companies in the u.s. matt: absolutely. you hear from a number of the supervisory board, they are all speaking and they are saying exactly that. we will get this done as quickly as possible while being us borrow as we can, so a long-term goal but they definitely say that anyone who was involved in this illicit action is going to have to face the consequences and they are in support of the state probe looking into the possibility of aggravated fraud. as you pointed out, martin winterkorn stepping down today. this is the first step and it is possible that the board -- i want to point this out -- only installs an interim ceo on friday. for example, at every court, they said before the news came out that muller over a porsche could be a good solution for now. probably not for the longer term because a lot of analysts have said that volkswagen is going to
want to put someone in here who is not tainted by this scandal, someone who is not at all involved with the day-to-day dealings with the company and that would include anyone who works for porsche, even if he came from bmw. the interesting question would be if they would let someone who is not german. have traditions of being fairly nationalistic when it comes to picking their supervisors, their ceos, and i recall when they installed a non-german ceo of deutsche bank and the entire country practically freaked out. it is unlikely they choose someone who is not a german dissent but it will be interesting to see if they put in an interim ceo or they put a floor placement. by the way, i cannot overstate how important it is to announce and porsche. we're not talking about tom cruise in "risky business," it is porsche. scarlet: matt miller, you have
trained as well. we have them consistent in saying porsche and centre court. stay with us because we have more coverage on the story. alix: for all the fx in the u.s. , we want to bring eric wyman, vice president of industry insights at true car and he joins us from california. eric, what is your take on the breaking news? agree it is something we have anticipated as soon as the news broke. with there had to be a scapegoat. a scapegoataps not and that, admitting that he did not have any direct involvement or knowledge of the situation. it could be nmp to mentor the revolution of this issue. consumers want to understand the resolution of the issue so they can move forward with this resolution. scarlet: everyone is looking for a solution but at the same time,
most like in was promoting this idea clean diesel. they have been pulling from the videos from youtube. what does this commission scandal due to the effort to promote clean diesel and the united states? eric: it puts them in a tough spot. they have relied on the clean diesel technologies as their entry into the alternative fuel world we have seen waging. and it is being won by the hybrid technology, the occult like the toyota previous and they have not had that type of hybrid technology to be competitive so they have relied on queen diesel for the actual efficiency and environmental standpoints. now that that is abandoned, they have got to reconcile that issue and the hole in the portfolio. the souls of make about 22% of dieselserall sales -- make about site 2% of their overall sales and it is a gap they will have to fill. alix: what has to they have to do? martin winterkorn is no longer at the home and they're taking steps, but what more do think
they need to have happened for consumers that were confidence? eric: when we look historically at massive recalls or pr issues in the u.s. market, we have seen two distinct patterns. when the automaker organizations involved admit wrongdoing and move forward to try was on the issue, we see that there are attempts to be negligible used marketerms of performance and resell values and transaction prices on the new car side. competitives a nature or donal of wrongdoing, we tend to see it is dragged down in mainstream media and there is more of a delay. in the circumstances, we have also seen that over the long term, the brands have been ability to recover when you think of things like the ford explorer rollover issue or the toyota unintended runaway acceleration issue. they have recovered and doing quite well. the difference is the intense, deception, manipulation.
will american consumers be able to get over that scandal? scarlet: that might be the hardest across. thank you to eric lyman, vice president of the industry of two car. joining us from california and we would like to thank matt miller who was been giving us great context, including how to pronounce porsche. thank you. you will save your voice and i will see later this afternoon. alix: it will be a fascinating day to cover markets and all over volkswagen. scarlet: much more coverage. martin winterkorn stepping down, resigning and probes are continuing at the carmaker. we will have much more after this. ♪
they rebounded today after some steep declines. is good to ryan in london. rebounding today did not really react to the resignation of martin winterkorn . ryan: that is right. the market is still open for six seconds so things could change. up 4.67%. that is the biggest gainer today on the dax. by one point by almost 10%. the boss of more than 600,000 people, the boss of the w for the last eight years will step down. the shares have given up some of their gains. is ink the reason for that guess his department was somewhat anticipated. but forget today's shareprice performance. i want to show you a six-month graph. it shows you it's been a not so
fantastic six months. shares down by more than 50%. you can go to the end. friday at close, shares were still trading above 160 euros. they are now at one and 11 -- 11. --111. they have lost 35%. it will take a little bit more than a one-day gain like today. the best dinner on the dax today, one of the most traded stocks, more than 10 million shares, volkswagen shares. six times the daily average if you look at the last six months. a huge amount of interest in this stock. the day started pretty positively forge vw. it tanked in the first 15 minutes and then rose by more than 10%. then we got the evidence, martin winterkorn saying he will step
down and in the press conference of the members of the executive committee of the supervisory board saying he would step down. but the shareprice not taking off after that. that is extraordinary because this guy is an entity in the car industry. vw is the biggest carmaker in the world. he was the biggest in europe by far but his departure out the back door effectively of this factory in germany was not enough to either worry or excite investors. they were anticipating it in the still of the concerns. scarlet and we do not know who will replace him. we will come back to you but it went to bring in matt miller, our resident car guide who is recovering this for days. what i find interesting is that there are going to be winners and losers in this scandal. did manipulate admissions testing.
yet if you look the share prices of the stocks, they fall in tandem with vw. of dieselsales a lot cars and sodas daimler. -- so does daimler. the chairman of the porsche unit of volkswagen. ayan carmaker has a c diesel engine. which --s from bmw americans might not be as informed as to how many diesel cars these makers are selling. -5-% of their inventory is diesel -- 50% of the inventory is diesel/ you also see it from bmw.
the reason you were seeing all these carmakers in europe falling in tandem is because they all make diesel engines and not many of them have come out with statements. goan from nissan is yeley one 200 -- is the only one to address the issue. i'm sure many are checking their own emission standards and testing and seeing how they got through testing when folks like an not of been able to without cheating. volkswagen needs to install a ceo not connected or tainted to any diesel engines. scarlet: irony of irony is that volkswagen was doing better in the u.s.. it turned the corner. in a very ambitious plans stateside and was starting to get traction. ryan: that's absolutely right. the u.s. is the world's second-biggest car market. yet to get the u.s. right if you want to be as successful or
ambitious as volkswagen is. we some of the audi, a big scandal in the late 80's. it was effectively withdrawn from u.s. market and they were just going to have success again with the audi brand. now we have this which -- one quick point to what that was saying. -- matt was saying. we did hear the industry body say there was no evidence that any of the other european carmakers were cheating in the same with the volkswagen was. we have seen some of the european carmakers begin to distance themselves from volkswagen. they all have relationships and don't like to directly badmouth each other but they have started to pull back and increase the isolation that vw is now facing. people understand this is a big long-term problem for volkswagen. scarlet: thanky so much for the
perspective. and matt miller who is been on top of this story from day one here in new york. we will be checking in with them periodically. our other top story of the day is china's president getting down to business in the u.s. then he and president obama overcome the tensions there to make progress on their to do list? ♪
he addressed a packed house of u.s. business leaders and cyber security was a big topic. seattleer isn't co2 -- -- our reporter isn't seattle. >> right behind me in the westin seattle is a veritable who's who of u.s. and china chief executive officers. disney's bobook, iger, and howard schultz on the u.s. side. the head of alibaba and the bank of china. these 30 total executives run copies with a market value of $3 trillion. there is a lot of business going on. 10:30supposed in around local. last night we were listening to china's president give his first policy address. he spoke about currency
devaluation saying china does not devalue its currency, although it did see it the value by about 3% in august. he talked about a slowing chinese economy in a knowledge china is still trying -- feeling downward pressure. he talked about cyber espionage. >> the international community should on the basis of mutual respect and trust work together to build a peaceful secure, open cyberspace. china is ready to set up a high-level joint dialogue mechanism with united states on fighting cybercrime. this are waiting for institute roundtable to begin shortly. once we do we will give you any headlines that are breaking. scarlet: thank you so much for that coverage. -- a in seattle where the
list of things straining u.s.-chinese relations is long. on which areas will there be progress made? aconducted sheryl udon, best-selling author. she is also a banker at midmarket securities. welcome. we know that china and u.s. have a bilateral relationship. how has it evolved since he rose to prominence and he became president? >> it is very interesting and almost ironic that we have almost a reversal of when president obama first went over there. it was in the middle of the next financial crisis. china's economy was soaring. now he is a keen waited a great amount of power in the last three years.
but he is in a diminished position. the u.s. is recovering. we might have a reversal of roles. who has the upper hand? >> both have restricted maneuverability. he really has been very aggressive on the military front. because he is so public about it, it is difficult for him to back down in the south tennessee -- south china sea. the pentagon has been asked to send ships as a show of force with the ministration said no. obama wants to gain sense of consensus around there, it will be hard for them to display any type of military strength. what are china's defenses? this is internal.
it does not apply to the united states. this is a regional dispute. it does not concern the united states. it's also about nationalism. what kind of broke in the u.s. play? >> in the south china sea they can move the discussion from an internal discussion that china keeps trying to harp on to a global stage. china really needs to take on some global response ability. is the second largest economy in the world. the security council. realpl -- real player. appeal to their sensory se of responsibly? >> when it comes to a commercial espionage, that is really hurting u.s. companies.
now they will face a weaker economy in china. they are facing weaker access. and potentially hacking and commercial espionage. scarlet: we know companies are worried about the corporate espionage, that china will steal their trade secrets. speaks often to chinese ceos, is the feeling mutual? >> the chinese certainly one access to the u.s. but they had it. we are beginning to see chinese companies come to the u.s. to buy companies, sell to americans, build plants and manufacturing facilities. they are beginning to get to market. u.s. the americans are having a harder time. there have been new regulations that are making it more difficult for the americans to get access. they are throwing internet rules and regulations, stiffening them so make it more difficult for
american companies to operate. survey ofk at the american business people, in 2010 about 58% were very optimistic about business in china. now it is down to 24%. scarlet: i wonder how much of a bad taste the obama administration has in pushing for its ability to press for concessions. >> it is another irritant. there are many irritants in this relationship. it's a very weak terms and it is not clear how things are going to get better. maybe we have some bright spots in climate change, but on many fronts there is little maneuverability on other side -- either side. scarlet: more pomp and circumstance rather than substance? >> probably a little bit more. scarlet: senior managing director at the market
♪ scarlet: seven years ago milen but the right to produce the epipen. at the time it was not imagined -- exactly a hot property but they can live with a clever marketing strategy and now it is a $1 billion grant. cynthia, this is an incredible tale. had they turn the epipen around. >> they conducted a marketing
campaign. one of which was legislative. they helped push through legislative that made it a mainstay in schools. i think that helped the brand gain awareness among parents with childhood allergies on the rise. they were able to grow the brentess of epipen as of -- as a brand. scarlet: the also raise prices? cynthia: they were pushing through price increases on the drug which is not uncommon. and the more prominent it becomes as they go to therapy, the more they can charge in an environment where they're all not any real competitors. of them reminds me jacking up the price of that till from $15 to $750. nynthia: what happened with tar
was how they can get called out when they do it so suddenly. epipen as a gradual and going on for a number of years. epipen is not unusual at all. it's a very common practice. drugmakers are able to push through the price because there is not as much scrutiny on the strokes. usually -- scrutiny on these drugs. scarlet: one thing that is remarkable is a think of so many parents who have multiple epipens. they have it in the car, their purse, the school, grandma's house. you have people buying multiple pins and this is how they sell it. these are the guidelines that help -- they call it adherence, to keep patients getting two pens at a
time. but it expires every year. if you have to bite them for your child this year, you will have to buy six more. and need multiple pens continually update the prescription. scarlet: there are other computing medicines. why are they not gaining traction? other product are set allergist or positive about, en first cannot they were at a similar price. now it's on the majority of influence -- insurance providers so they need the market and build brand awareness and they are probably having to take the qs from -- cues. what could happen later this year is trying to get a generic
equivalent product approved by the fda. that will come down to whether or not they improve the product as an equivalent product. then it will be a substitutable product. that's the big risk that they will have that level of competition. they have a settlement and that is what allowed them to pursue fda approval for this other product. if the fda does not make it substitutable it will not necessarily be the competitive threat it could be. scarlet: thanky so much. -- thank you so much. at can find the story bloombergbusinessweek.com. time for this week's options inside. matt has been very busy. matt: we are looking into markets very closely right now approaching the top of the hour. look at the major averages on the screen. down across the board. you can see the s&p 500 down seven points.
down.w that trend we saw in european markets of different recovery is not we have here in the u.s. joining me is dan pastorelli, president of market tak ttaker.com. i want to start with the action in the broader market. what is holding us back and how do you play that? is holding us back today is the same thing holding us back for a long time. the market is like a monster movie. a long time ago we heard that there was this ominous thing coming and we been watching this movie for two years. now we are at the point where he know it is imminent. we are watching it right now. matt: do you make any bets longer-term or as visibility limited? is that one of the big problems? dan: that is the thing.
we know at this monster looks like. i think a lot of that is already priced into our market. there was a number of different ways to play this long-term and short-term. long-term, a great time with his elevated vix level to be selling options, evading some of the dips. in the short-term there are ways to trading get positions in quality stocks like facebook. matt: facebook is part of the trade today. tell me about it. dan: the trade i like and facebook is the october 92-95 bull call fred. -- thread. there is support underneath the market, supported the 50 day moving average. right now if it lives up to $95 per share they could be a pretty leveraged products. matt: and the stock is an incredibly well of late?
11 days in a row of gains until yesterday's 2.5% drop. dan: exactly. it could be strong in this down market and another thing i like about facebook is volatility is really low right now which means the options are cheap and it sets up for a nice play for your behind a call spread. matt: are there any fundamental issues you look like -- look at the could sway your opinion on facebook? dan: i'm looking at it fundamentally and technically. i'm really looking at strong support for the 50 day moving average and the move it is had lately. matt: what makes you think he will not break below that support? history anding by some of the things i've seen in the news lately. if it does break through, that is the real strength of this trade. it is limited risk.
i'm only risking about $1.75 on this trade. on -- i am close to doubling that if i am right. matt: that is the point of the hedge. thank you very much dan. president of markettaker.com. we will continue to cover the volkswagen breaking news. dr. martin winterkorn stepping down in the wake of a scandal that so far has cost the to lose $7.3 billion in that might be far too little. ♪
we will take a look at what is next for the automaker. president meets with business leaders. newlet: an exclusive bloomberg poll shows that vice president joe biden would have significant support if he decided to run for the white house. we will have the full results. ♪ scarlet: good afternoon. betty: let's begin with how the markets are trading at this moment at midday. we are seeing the slide, down about 95 points. we continued keeping all right on automakers, particularly volkswagen shares. trading has closed in germany
but you can see the news that we got, including the department of martin -- departure of martin winterkorn. scarlet: a quick check on currencies. the euro gaining strength versus the dollar. this is after mario draghi said is too soon to say whether risk to the economy means that the ecb should increase stimulus. they need more time and data. the fed needs more time and data to see if it should raise rates, heightened policy. ecb needs time to see if it should loosen policy. we are in no man's land. betty: you can look at data in different ways and camilla different conclusions. -- comes out with different conclusions. scarlet: volkswagen's ceo will resign. this comes after meeting with the board's executive committee. "i'm doing this in the interest
of the company even though i'm not aware of any wrongdoing on my part." joining us now is matt miller who is been following this story from the beginning. does anybody believe that winterkorn had no knowledge of this? matt: i can't speak to what other people think. a lot of people we have spoken likely he is very did. he was an engineer's engineer. this guy had real attention to detail. he would walk into the factory in chattanooga and say i don't like the way pieces of this car are arranged on the wall for viewing. arrange them on the table under different lighting. one time at a race he took the gearbox apart himself to figure out what the problem was. this kite -- guy knows how cars work and took a very serious interest in that. notuld not imagine he did
take interest in all the sudden the diesel engines were passing california emissions tests. how did that happen? i guy like him would've wanted and found out the answer. i would think. of course, we don't know. closer and closer to a court of law, i don't really want to make any bold statements about what winterkorn newer did not know. scarlet: i think it's striking when a former ceo says something akin to you must've known. top.ll, it starts at the mary went through this at gm. you have to create the culture of compliance. if there was complicity in this thing where he had to know -- tom: you are stating he had to know? >> i think he had to know this was taking place. it's hard to believe someone in a position -- it's one thing to make an error.
if it's true, a conscious decision to circumvent the regulation in the u.s. betty: regardless of if he did or did not know, i think bob is right. the ultimate fault lies with you, the ceo of the company. he had to take the fall. scarlet: it was on his watch. matt: it's important to look at the parallel with general motors. they had a defective part that literally kill people. more than 100 people and others were maimed and permanently injured. none of those executives had to take the fall. to be fair, mary had just come into her position as chief executive officer when this issue wasn't covered but she had worked at the coming for 30 years before that. i think following that model, ask for an internal investigation. make sure it was like an independent, outside
investigator and try to push the blame onto some lower-level employees and eventually you can get away with just paying a fine. case it might be up far heftier costs. they may be looking at something like buying back all the cars or paying fines they could beat $18 billion to the epa. they have a possibly higher cost year but no one is actually indicted. betty: matt, thank you so much. matt miller in our newsroom. i would to bring in mark gilbert from london. scarlet: he wrote a piece today saying it looks like -- the question to you is our automotive engineers the new rogue bankers? echoeshere are a lot of to we are seeing in the auto industry. there was never only one cockroach. that is what we learned in the currency rigging.
that is what i suspect we will learn in the auto industry. i doubt volkswagen is the only one that has been playing fast and loose with the rules of epa. if you look back in the auto industry trade magazines and look through reporting in recent years, everyone knew carmakers were gaining the system. how do you feel efficiency figures of the edit than anyone can get in the real world. i think the coaching of regulation that is at fault. if you don't break one broken window, all the windows get broken. if the regulations allow automakers to get away with murder on emissions testing and feel efficiency testing, the automaker culture will try to get away with more and more. that is where the fault is. betty: in your view is a right that it is even worse in some way? the consequences of this as recall,en with the gm
lives are at stake, but in your view this is worse? mark: is worse in two ways. this is not an error that they try to cover up. this is an actual malice of all thoughts even they knew what they were doing with the software code and they did it deliberately. in the finance scandal it is only money. the reasons we have emissions standards is because the stuff that comes out of the back of cars is dangerous for people. whatever engineer it was approved the coded volkswagen, they are hurting people. someone has to go to jail for this. i think the finds you might see, particularly if the rest of the industry is as guilty as volkswagen seems to be, the ake $10 million the bank paid of like a drop in the ocean -- $10 billion the
banks paid like a drop in the ocean. scarlet: volkswagen is owned -- 20% of it is owned by lower saxony and the state will make sure that the company does not fail financially. what is your take? mark: i hope one of the lessons we learn from the financial crisis is that economic darwinism is a good thing. i think it would be a mistake of the german government keeps volkswagen out of the fire. there are a lot of jobs involved .ut again it's about culture if you allow companies to get away with the sort of behavior, they will just repeat it again and again. i hope darwinism comes into this and volkswagen -- if a volkswagen is orderly when did it is a disaster but it might be what is needed. betty: people do you think of this whole comparison between wall street and the auto industry. the public generally thinks wall streeters are evil people they
do bad things. they don't necessarily think about that when it comes to the auto industry. we've seen so many scandals over the last 12 to 18 months. is there a sense in the public that hey, the auto industry has some bad people. mark: is interesting. the google motto "don't be evil," clearly the guys that started it are aware that corporate culture can quickly be eroded italy to this kind of behavior. the contrary example is when johnson & johnson had an issue when someone was tampering with his drugs and people were dying. they were very quick to take all the drugs off the market, apologize, compensate, all the things you hope a responsible company would do. it's not fair to tar all companies, but it seems the auto industry in particular -- maybe because it has such a hard time during the recession, but the auto industry seems to be not trying to do a good thing.
we need some cleansing and some darwinism. scarlet: mark gilbert, thanky so much. you can read his latest column on bloomberg.com. when you talk about bankers and wall street, you are talking about white-collar jobs. the automotive industry is blue-collar. sure, martin winterkorn is not blue-collar. but there is a willingness maybe orsee only good things, maybe there's a willingness to see a white-collar employee looking to maximize profit and game the system. the blue-collar are producing a servicer people he needed. betty: but the comparisons are very interesting between the two. the question is the matter how big the fines are, is a funnily going to change what is going on in either of those industries? scarlet: let's check in other
top stories at this hour. pope francis is more than platitudes -- had more than platitudes for the crowds. he said something has to be done right now about climate change. it seems clear to change is a climate longer be leftno to the future generations. [applause] he also urged that religious liberties be protected. he thought that one of america's most treasured possessions. earlier, the president greeted the pope in front of 11,000 people in the south lawn. president obama: today we mark many firsts. you're been celebrated as the first pope from the americas. [applause]
obama: this is your first visit to the united states. [applause] and you areama: also the first pontiff to share an encyclical through a twitter account. [laughter] [applause] scarlet: they held a private meeting and the pope addresses congress tomorrow. mario draghi says the big east time to determine if more economic stimulus is needed. he told the european bank that if the inflation outlook weakens, they would not hesitate to act. that echoes, from some policy makers who are reluctant to increase stimulus. a baseball legend is dead. fans will remove her him and a smile. berra was one of the greatest catchers ever. he died yesterday in new jersey.
he was 90 years old. love his sayings. scarlet: "it ain't over till it's over." did he say that? it's like deja vu all over again." result ofing up, the a bloomberg poll that shows how much support vice president joe biden would have if he entered the race for the white house. scarlet: the pope getting a warm welcome at the white house. some of the issues he is discussing. ♪
triple digit move in the last 25 session now. matt: to the downside for those investors were long out there. take a look at the indexes and you will see we are down across the board with the dow losing 106 points. 9%.s&p following about 4739.sdaq down to about not showing the gains over in europe. as far as the biggest losers, it is really the industrial stocks that are showing the big losses today. interestingly enough we see boeing there is well even though 7's in orders for 330 73 china. caterpillar is down as well as you tx. -- utx. these old economy companies taking a hit in today's market. as far as gainers, drugmakers,
health care companies doing well on the day. pfizer is up 1%. unitedhealth group not showing as much of a move and american merck up. i want to look it when as well -- wynn as well. over the last five days they have fallen almost 20% because of junk it concerns and problems with the macau gaming industry. betty, you were there recently did together? betty: it was too far away. we were in macau last year. matt: did you spend a lot of money? people don't seem to be doing that as much. it's really not a question of individuals and i'm sure as a human you are a better.
people are noty taking big betting trips to macau, at least they're not losing much. betty: interesting. thanky so much. -- thank you so much. scarlet: now a look at the top stories of this hour. two journalists imprisoned energy -- imprisoned and egypt will be released today. they were imprisoned for what prosecutors called "false news." the fate of a third journalist is not known. betty: canada's finance minister says the country is not in recession. despite data showing otherwise. joe oliver tells ap that is largely confined to the energy sector. canada's economy retreated from april through june after sliding 1/10 of 1% the first three months of this year. uber is testing a carpooling service in china.
it allows drivers to pick up passengers revenue looking for a ride along their route. it sounds like lift. this is the first of a global product is he released outside the u.s. by uber and underscores their commitment to china. that is a look at the top stories at this hour. betty: we were in beijing and i did use uber there. their im, walking the streets. the interesting thing with my producer is that they were laughing about this in my ear. but the otherr one, the local one is way m ore popular. because us for uber there are several taxi drivers we would hail and they would refuse to take us to the destination we wanted unless it was a place they want to go to.
they wanted to go to the airport where the hair is higher? betty: exactly. scarlet: i think it is interest in the cooper is launching this isinteresting that uber launching this. there is a laid-back feel compared to beijing. it's kind of underregualted. -- under regulated. use that something like that in the face of competition. china'still ahead, president meets with some of the top business leaders in the u.s. scarlet: a live report and a look at what he hopes to accomplish including a possible cyber security deal with the u.s. ♪
day." scarlet: we're still laughing at her walking through beijing. china's president is meeting with top u.s. business leaders right now. you name them, they are there. betty: a who's who of ceos. the president is hoping to make progress on a number of fronts. here is what he said last night. >> the international community should on the basis of mutual respect and mutual trust work together to build a peaceful, secure, open, and cooperative cyberspace. aina is ready to set up high-level joint dialogue mechanism with united states on fighting cybercrime. betty: joining us now, rami. what is the president saying to the ceos today?
>> good morning from seattle. inside behind me you can bet there was a lot of hot talking going on. ceos, chief 30 executives from the u.s. and china are in a meeting along with the chinese president. they are talking about greater market access to get into the u.s. and china. they do include tim cook. revenue inapple's china double recently based ui phones. howard schultz plans to double the amount of starbucks stores in china through 2019. and disney's bob iger it was opening the next disney next disneyhe resort in shanghai in spring. wasdes that, president xi talking about his first policy address.
among the major topics was cyber security. he was also talking about currency devaluation and the economy. a research survey earlier this year said that cyber spying, cyber espionage was one of the top three concerns of americans. back to this morning, we do expect that mr. xi was be speaking about 1:10 p.m. eastern . scarlet: the president will be meeting with president obama of the united states as well later this week. what is likely to be the top issue when they meet? >> right here in seattle we are talking about e-con. d.c., wect into -- in spent the do change to politics s.re it -- politics her china has claimed about 4/5 of
the south china sea. that is angered a lot of their neighbors. they could also talk about climate change, looking at the paris talks later on in december. we will be trailing him over the course of the day. back to you. scarlet: thank you so much. ramy is on scene in seattle. betty: it is cold there. i can't believe winter is coming. ahead in the next half hour, scarlet and -- we say goodbye to you. next up on the president of china and what he hopes to a, was his visit to united states. they will be speaking with the former ceo of morgan stanley asia. that interview in the next half hour. ♪
great time for a shiny floor wax, no? not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. betty: welcome back to the bloomberg market day. i am betty liu. let's look at the headlines this hour. a shakeup at volkswagen.
ceo martin winterkorn is out. he says he is not aware of any wrongdoing on his part. still, winterkorn says vw needs a fresh start. vw could face billions of dollars in fines and certainly a lot of repair costs. you know lever is one of three companies pledging to zero out greenhouse gas emissions by 2050. ceo paul coleman one of the chief executive surging government to adopt their own net zero target. he spoke to francine lacqua in an exclusive interview. paul: it is our duty as the ceo's of the world to set the to make sure we are ultimately driven by the needs of consumers. week in new this york, the u.n. is holding meetings on sustainable development. well producers in the u.s. are about to see their credit line shrink and just when they need money to most.
a new survey says that almost 80% of oil and natural gas producers will see a reduction in the maximum amount they can borrow. the survey says credit lines would be cut by an average of 39%. ceo under fire for increasing the price of a life-saving drug by more than 5000% now says he will cut the price. martin shkreli says he will lower the cost of daraprim in response to the outrage over the increase. we spoke with him on monday about the price hike. the price per discourse of treatment is a free life is only $1000 and we know that these days, cancer drugs can cost $100,000 a more worse these drugs can cost half $1 million. berra print is underpriced relative to its peers. betty: not anymore, right? the price went from $13.50 to $750 per pill. newid not say what the price would be. that is a look at the top stories of this hour. tilde clinton is starting to feel the heat.
a new bloomberg poll shows mrs. clinton still leading the democratic field, but her numbers continue to slip. most surprising, perhaps, is the sudden emergence of someone who is totally not declared yet, vice president joe biden. we have a bloomberg: pope francis showing that americans are less than enthusiastic on his stance, as we heard earlier, on climate change and income inequality. with us to break down these andmers is survey director sellers are and phil mattingly of bloomberg. donald trump always has to still the show, right --steal the show, right? he tweeted out a few moments ago that he will not be doing any more shows on fox. "fox news has been treating me very unfairly and i therefore decided i will not be doing any more fox shows for the foreseeable future." what do you read into that? phil: tough skin political candidate.
this has been ongoing from the first debate, the interaction with megan kelly. he said things that fox people do not appreciate that he has had conversations with roger ailes about how he talked about megyn kelly. he was showing back up again, particularly on sean hannity's show. over the last few days he started attacking bill o'reilly and started again on megyn kelly. yesterday he said it was hard to watch fox news because they were too tough on him. the thing about donald trump and just to talk about how he himself has shifted the paradigm, imagine any other republican candidates saying they were no longer going to appear on fox. it is absurd, not even in the realm of possibility. he is just going to go out and say it. is this donald trump's personally or mike fox have something to do with the fact that he is now declaring? betty: might say you are disinvited? it is hard to be a republican candidate and not be on fox
news, right? i'm sorry, they helped make candidates. >> but what donald trump is found as he gets media wherever he goes, and he has been able to be on the phone and not actually be on set. than calling more shots not. it will be interesting if this does have an impact but it seems to me that he is more in control of this. betty: even if the master is not, as best back story is not come as phil alludes. little bit losing a of control here, we see hillary clinton numbers going down. what is going on with joe biden? one in four think he is a better candidate. ann: joe biden is not an announced candidate. why did we put him in our poll? we do not nominate candidates with the national poll. we wanted a sense of the nation, the mood of the electorate. the mood of the electorate is open to joe biden. one in four say see would
be their first choice. this is registered democrats and people who lean towards registered democrats. it is about equal with bernie sanders, who has been out on the campaign trail and a long time announced candidate. hillary clinton still has that lead. what is fascinating is to look at her favorability numbers. overall, when you look at all americans, in their view, she has dropped 10 points since april, the last time we mention her. betty: isn't her favorability lower? 38%. biden is 49%. ann: exactly. you end up with a view of the way that things are looking for him, not an announced candidate, not in a harsh spotlight of news but with kind of a law coming ground for him to step onto his he decides -- when he does that come if he does that, it changes the equation. we will see what happens then. betty: but he has the benefit right now, phil -- he hasn't
declared so he is not answering questions and being criticized quite yet. how likely is that to change? phil: his team, fully professional, slightly outside his orbit in the process right now. when it comes to favorability, those numbers will start dropping good that is natural. thewhen you look at it, quarter were not only support him, but 52% of democrats or lean democrats want him to get into the race. even people who are not explicitly supporting you want him to get income even if they are not diehard joe biden supporters. this comes down to one man and his wife. but these other types of things that open doors. process,t is primary how you raise money, who your surrogates are, but these are the types of things that open the doors to say ok, this is realistic. this isn't just a pipe dream. is showing me is this
is realistic if i want to go through the process. betty: this hillary clinton holding onto the democratic woman vote? the things i found interesting is she still leads with women but only by four percentage points over men. she is the leader among men, too. betty: has that shrank? ann: the gender gap has treated her nicely with more women being especially supportive. bernie sanders has the opposite, 10 percentage points higher among men. joe biden is even. let's see if i can say this word -- no, i can't say it. [laughter] betty: androgynous? , where iogynousization was trying to go. gender gap is less important within the democratic party. betty: you also did a survey about the pope. more than 80% of catholics
approve of the pope. but if you were a proof of his fewer approve of his stance on climate change, just about one third, and a little more than that on income inequality. ann: we look at the several things that the pope has been doing recently that change the direction of where the catholic church has been for decades and centuries. moving the church in a production or a bad direction -- for all of those things that are related to church business, having to do with the role of women in the church, the ease with which you can get an ailment, how you react -- how yowith which you can get an annulment, how you react to gay parishioners, all that has strong support. once you turn to items that are more political like income inequality and climate change, wait a second, is this moving the church in the figure direction? not so much. the way he has tried to make the case, that there is a moral argument for it, might not be overcoming the politicization. betty: more compassion about gay
marriage but does not approve it, but more compassionate language. who is he to judge, exactly. that is the line that was very pivotal. and obama, the president, seems very -- welcome him with open arms. the whole family went there to welcome the pope. what do you read into that? see a natural alliance on some of the qiagen items -- immigration, climate change, criminal justice reform. the june encyclical is very prominent on climate change. speech today, most of which was in english, address climate change. the white house looks at him as a natural ally on the key agenda items. the president personally likes the pope. they had a one-on-one meeting in the vatican last year -- betty: you can tell. phil: i was talking to white house officials in the days leading up to this and they were somewhat wary.
you cannot control at the pope will say when he comes to washington. some concern because particularly on abortion and gay marriage but most notably on syria, a huge weakness for the obama administration right now, the pope has been critical. hadar, the comments he today were almost entirely in line with what the white house wants to hear right now. live: this is the pope right now speaking to u.s. bishops. that is on his agenda today. tomorrow, i believe, he is going to be in a new york addressing -- phil: tomorrow is on gas, and then the you -- tomorrow is congress, and then the u.n. after that. reallyw will be interesting. climate change -- you talk about the numbers that people are concerned about. republicans or conservatives really driving down those numbers when it comes to climate change. you see that in a number of polls. republicans on capitol hill, one
has said he will boycott, a catholic has said he will boycott the joint session of congress because of the pope's willingness to talk about climate change. this type of stuff makes them uncomfortable. what makes republicans also uncomfortable is the pope's comments on the economy and capitalism as a whole. you talk to prominent catholics, they like what the pope is doing particularly on social issues. they like the more understanding folk, i guess, on the sense of issues. but they are concerned about the broadside and very deliberate attack on capitalism. this isn't new. have done this in the past. but he has had very strong and sharp language and there is concern that if future that full throated attack on capitalism, the american economic system, wall street doesn't like that and it makes them uncomfortable and that the lines them with -- that aligns them with republicans on ideology. betty: that would cause much more attention. thank you, phil mattingly. thank you, and seltzer as well,
on these exclusive plumbers. wage growth has been slow in the u.s. but not for everyone. we will tell you about the sections that have the fastest rising wages. look around the corner and your starbucks. and volkswagen ceo martin winterkorn stepping down after nearly a decade at the helm. how the automakers handling the scandal over emissions tests. ♪
wellhe nasdaq is down as even less there than the s&p 500. take a look at where people are going. some of them are heading into -- the 10-year yield is of the little. -- is up a little. a real roller coaster. overnight we were down because .f chinese pmi figures then we were up because inventories came on bigger the next bit. just bigger than expected. flied out -- came on bigger than expected. result, thesea are the biggest losers in percentage terms on the s&p 500. consolall 500 stocks,
is the biggest loser. transition and freeport-mcmoran down as well. take a look at gold and copper. freeport-mcmoran reduces both of those. to 1132.ising proper is down. er is down. i finally want to take a look at volkswagen shares. in introducing move with the european shares, it hasn't been mirrored by u.s. shares, but a real rally this morning and overnight in europe and asia because of optimism that martin winterkorn would resign. he now has resigned and 80 some of the people who are making -- maybe some of the people who are making that that are taking it off the table. maybe they have not named a successor yet and the market is really looking forward to hear the successor.
the supervisory board said they would give the information on friday. so we are waiting with breath, betty. betty: we are indeed, matt. thank you so much. i know you are indeed. matt miller bloomberg -- of bloomberg. the u.s. unemployment rate is at 5.1%, but which work is stubbornly slow. there are careers that are hiking pay by as much as 10%. these include business systems analysts, secure the officers, sales consultants, pharmacy technicians, and even baristas. mark crumpton, who is joining me in the next hour, has more. mark: and his last days today because i'm going to become a very stuff -- i'm going to become a barista. were u.s. shocked as i was? sales consultants, security officer, business systems analyst.
betty: where is the engineer? this also brings to the for the minimum wage debate. it makes you wonder what these folks are getting paid, ista -- ay with a bar lot of them work in the copy shops and they have got to be at some point making a livable wage to be on this chart, which shows careers that have the highest wage growth. i don't know if this is a trend, do you? betty: who knows? it is a good trend. the fact that people are good at least for the economy and for the larger public that you are seeing is some wage growth. that is of the parties the end of the recession, we have seen very little wage growth across the board, and that is been frustrating for the economy. mark: and our collie did this story on bloomberg and bloomberg.com and she spoke to
said,ief economist at he i'm quoting in part, "we are seeing a wide range of job titles in the top 20 but what stands out is the number of tech jobs in demand not only by tech companies but in finance, health care, government, retail, and other sectors." if you are looking towards tech, you may have time to this just right. betty: exactly. we know that tech is a tightknit labor market there. you can graduate with an engineering degree and do well into the six figures. mark: very much so. betty: but maybe the growth they're in the wages -- it is not so much the wages, it is what you get benefits-wise, options, and others that make up your compensation. for these shots you just listed, it is all about the wages. that is her only compensation. mark: one of the things they're -land, inbout in tech
the pacific northwest, president xi jinping visiting there are talking to the titans of industry. a lot of business flowing between the u.s. and china but the elephant in the room is cyber security and cybercrime. they will be talking about that. don't know if those talks will bear any fruit. some people are telling us that that will come out in part of the discussions. we will be joined by stephen roach of yale university and he will join us the next hour. we will talk about president xi's visit and the state of u.s.-china relations going forward. betty: indeed come in a lot of that in the days ahead. thank you, mark. see you in a few minutes, mark crumpton. we will have much more ahead on the bloomberg market day. ♪
"bloomberg market day." i am betty liu. now comes an of the social networking club for the movers and shakers in the world. it officially launches in new york today. what sets it apart from others? while you are off making your millions or billions of dollars come even, it does all the social networking for you and is also invite-only. here to tell us more is the founder. basically, with all due respect, it is like linkedin for really successful people. >> that is pretty much correct, yeah. betty: and you are happy with that? >> we're focused on a very niche market and most of them were not using social media before. we are working in a very small niche. betty: how you going to convince them to join? ndrew: they understand that they have not used to social media in the past and it is where the world is going and there are advantages to being
online and it has never been anywhere for them to go. the marque allows them to do that. betty: he started this with your own -- andrew: initially. betty: what gave you decided to do it? -- this idea to do it? andrew: i was looking for a new idea -- betty: what was your last market? andrew: i was in the telecom market. thater research showed there were not using linkedin or any of the other networks, and i tried to understand why. betty: they were getting spamm ed? andrew: they were getting requests that were not adding value to them. -- when they do
get requests it is hopefully someone of interest. betty: who is on it right now? andrew: we launched in london in may. we have seen some good growth in london. receptiond with a hosted by danny lopez. we have our 50 founder members in new york and the response has been amazing. haven't there been others like this? i got an invite for a small world. andrew: that started off incredibly and we can learn from the mistakes they made and what they did is they grew too quickly. they needed to grow quickly to get traction. ereas the marque is a subscription model and there is
absolutely no advertising on the platform. we are focused on quality. betty: what are your minimum requirements to get invited? andrew: the only way you can become a member is to be recommended by existing members, and each member can invite five people onto the marque. we're focused on quality and typically every person on the network is for the level and we will try to maintain the quality. betty: ok, andrew, thank you so much. andrew: thank you so much for having me. betty: much more ahead on that."rg "market we will look at issues that pope francis wants to raise on his visit to the u.s., including climate change, immigration, and income inequality. ♪
meets with business titans including jeff bezos and howard schultz. betty: end of the road for volkswagen ceo martin winterkorn. the emissionster cheating scandal, although he is not taking any personal responsibility. mark: startup that gives life to startups. we will be joined by the president of the company that has helped to fund companies like airbnb and lyft. betty: good afternoon. i am betty liu. mark: i am mark crumpton. thank you for staying with us on "bloomberg market day." a lot to get to on this wednesday. betty: a lot of news. mark: volkswagen still in the news. matt miller is in the newsroom with details on how wall street is doing on this autumnal equinox, first day of fall. betty: wow. matt: ooh, first day of fall.
excellent. i'm still wearing flip-flops. [laughter] not huge losses, although we are seeing the markets move off the session lows. 89 on the dow, 60,240. nasdaq is moving back to basically unchanged at 4752. i'm want to go through some of the individual stocks that we are watching in this session and then i will touch on volkswagen. go pro has price target drops by analysts at talon and committee, sales growth or sales boom has not been as big as expected, just at the beginning of the cycle there. they say it is still top-ranked on amazon and top-ranked on best buy, and they don't expect apple to come in with an action camera that would really be a huge , buttition here downgrading the price target to $60 from $76.
a mover today, a beginner yesterday on a big note from jeffrey's, which is said it is a looking from the acquisition target. big game yesterday, big drop today. up more than 7% yesterday and now it is down 5% in today's session. buy fromupgrade to underperform. along with a slew of internet companies. , an internetorum company forum for investors -- baidu is that the lows of the day now, almost 3% there. want to keep-- one to keep an eye on. volkswagen, a story of not been able to stop thinking about since friday night. martin winterkorn has finally resigned. it seems like it has been weeks, although it has only been a few
days. flown byfor him it has come in the wake of this epa emissions cheating scandal. the next questions for investors are do other companies need to come forward with similar admissions, similar statements? obviously, a lot of european countries are making diesel car engines, and it is having great success with them. apparently a fluid that cleans out the nitric oxide pollutants that are the offending pollutants for volkswagen. i guess people didn't really get how they were able to pass california emissions. now we know it is cheating. one of the questions for investors is who replaces martin winterkorn as ceo of volkswagen. betty: that's right, that is still a question that is unanswered right now. thank you so much, matt miller with the market. chinese president xi jinping is in seattle, as we mentioned. he is an attack meeting with executives from 30 companies, including jeff bezos, tim cook, and bob iger.
mark: president xi is facing a number of issues including a slowing economy back home and criticism from the united states over cyberattacks, climate change, and human rights. joining us with more insight, appeal university, the former chairman of morgan stanley asia. thank you for your time. one of the things that the ceo's are looking for is a bilateral investment treaty. all the american ceo's taking part signed a letter to president obama and president xi asking that such a treaty be signed and went into full effect. what you think the chances of that happening are? stephen: i still think they are low in terms of imminent breakthrough. but i hope i am wrong. there is not a lot of ground to be optimistic on too many of the main issues of this important summit between the two leaders. this may be one area where there is some wiggle room.
market access is absolutely key. china stimulus domestic demand, especially consumption demand, and gross the largest middle class in the world. u.s. companies certainly one piece of that. a bilateral investment treaty is very important device to enable that to occur. betty: you know, there is going to be a lot of latitudes-- p latitudes between the two sides in what president xi will say during his visit. will anything finally change between the u.s. and china after his visit? stephen: well, betty, there are a lot of issues on the table right now, from territorial disputes to the slowing economy, some of the currency and trade issues. but the one that is really cyber, over right now is and there is a lot of talk that
onre may be a deal struck cyber warfare, high-level exchanges on this issue. but in the same sense it is pretty clear that the u.s. is about to impose sanctions on a number of high-profile chinese companies for the outrageous cyber hacking that was uncovered just recently. how we make progress on this critical issue, which really defines the fabric of engagement between the two nations and the rest of the world, that is a bit of an important sticking point, in my view. mark: speaking of sticking points, let's go back to august, the currency devaluation. is that something on the mind of the business leaders, or because the valuation was so small, was that a nonstarter during negotiations? well, i think currency is always an issue, especially during a presidential election year, but the movements have
been very small after a 10-year run about 35% of the chinese currency versus the dollar, do not appear to be an imminent threat. there are always those who continued to rattle on about chinese currency manipulation, but until there is more concrete evidence that the chinese are going to use the currency as a tool to really support a startling export sector, i think this is likely to be one of the least important issues on the agenda. you sayut when evidence, unless there is more evidence, what would we be looking for until more moves to the value the currency? stephen: depreciation of the renminbi versus the dollar. and that is hardly a significant reversal of a much more important uptrend in the red and
the. -- renminbi. mark: to the u.s. tech countries want to see movement from china on pollution, on climate change? are the chinese even amenable to having that discussion? stephen: yeah, look, year ago there was an important joint announcement between the u.s. and china on emission standards, and certainly very consistent with high priority that both countries place now on environmental degree nation and climate change and moving in to the so-called paris summit later this year, i would expect that agreement of a year ago to be reaffirmed. no major breakthrough. but for the tech companies, the big issue has got to be cyber. and those discussions are probably going on very actively right now. betty: before we go, just getting back to the chinese markets and how they behave following the depreciation of
the renminbi, and people criticizing the chinese for bungling their intervention in the market, does that mean that the environment for foreign investors, the environment that the investing climate in china is really that precarious, and is something we need to watch for, a major headwind in the next 12 months? stephen: i think that is probably an exaggeration, betty. the foreign multinationals are still very actively pursuing investmentss in china. if china delivers as expected and produces the largest middle-class consumption story in the world in the first half of the century, they want a piece of it. having said that, the volatility in capital markets, especially the bursting of the equity bubble, is actually more disconcerting for the chinese than it is for us, because it really is a major setback for them on the road to capital
market reforms. they have not looked good in managing both the upside and now the aftermath of the bursting of the bubble. mark: we have about 30 seconds left. what do you think wall street wants to hear out of these talks come out of these meetings? stephen: i think the investment environment would certainly be favorably reinforced if there was clear assurance that the chinese economy is in fact stabilizing, nearing a bottom, that the fears of a hard landing are overblown, and that some agreements could be reached on some of these contentious issues , especially in the cyber area. that would be good news for the markets. roach of yale university, thank you for your time. appreciate it. betty: you are looking at live pictures of pope francis speaking at a cathedral in washington, d c the pope has been attending midday prayers, where he touched
topics,iety of including the sex abuse scandal in the u.s. church, abortion, and worldwide hunger. earlier he met with president obama at the white house and urged the world to take action to fight climate change. in brussels, the european union president is urging divided eu nations to set aside their differences and security borders -- secure the borders. it comes ahead of an emergency summit as europe struggles with the biggest refugee crisis in decades. bill gross says it is time for the federal reserve to raise interest rates, and trade near market turmoil's is for longer-term stability. gross says zero interest rates cannot become the long-term norm , because investments won't produce the gains were cash flow needed to finance past promises. he says this scenario is already playing out in detroit and puerto rico, and he is protecting similar struggles for chicago. that is a look at the top stories we're following. coming up in the next half hour,
we usually see in the u.s.? brendan they have two boards, the management board, which is the c3, and on top of that, the supervisory board, capital and labor. that is the normal german structure. what is different about volkswagen is there is an extra bit of control for the unions. this is unique. the state where the main plants are located also has a 20% share in the company. they sit on the actual capital board but they also work with labor to move things their way. that is unique. mark: how unique? unique in the sense of europe? unique in the sense of the auto industry as a whole? brendan: unique for the auto industry, unique for europe. basically, they call this a golden chair. it is 20% but it is a controlling share because of a "ery perverse law -- "perverse perhaps wrong -- let's say unique law, written specifically
for volkswagen and on the german national register. they call it the volkswagen law and gives the state of lower saxony absolute veto power over major decisions, like the new ceo or the location of the plant . what you have is a state-controlled company could usually this is reserved for things like telecoms or gas committees, things with a compelling national interest. the only compelling national interest is keeping those jobs. betty: speaking of lower saxony, the prime minister was at this meeting at the press conference after this announcement from winterkorn. what was he doing there? brendan: well, he is on the board, that is what is so weird. week as primethe minister of lower saxony he said we will have an investigation. then from his position on the supervisory board, he announced today the company of the volkswagen will open up a civil suit over whoever did this within volkswagen.
this is a very tangled web, and we can't condemn -- exactly did we can't condemn the german style of capitalism. this is the volkswagen style of capitalism, different from the german style. mark: one of the criticisms of the volkswagen is it is insulated from its shareholders. is that part of the problem here? brendan: so i spoke to a couple of academics in germany who have looked at this for all well and they say we don't know enough to draw a line between this deception and their insulation from shareholders. what we do know is traditionally, companies that are this opaque and difficult to govern from capital tends to have hidden errors you might not see for a very long time. again, we don't know if that is what caused this. however, this is very similar to other companies. one thing to look at in the wake of the financial crisis, the german state banks had a huge failure rate. several of them had to be bailed out. this very cozy
relationship with the individual german states. usually this type of shenanigans does not produce good governance. betty: thank you so much. very interesting. brendan greeley. mark: it reminds me of that line from "the fugitive" where tommy lee jones comes across the train wreck and says "my my my, what a mess." [laughter] brendan: it gets worser and worser. betty: coming up, much more ahead. is solar power contributing to the excess supply of crude oil? mark: we will explore that question with our colleagues on bloomberg radio. ♪
it turns out they can help energy producers extract oil and gas in challenging environments. mark: we have challenging environments right now. for more on this story, let's join bloomberg radio's carol massar and cory johnson. they have a special guest. : a member of the sipc. mark barton, bayview, thank you so much. welcome all of our viewers on bloomberg television and bloomberg radio. cory johnson in san francisco, carol massar here in new york. we will talk about solar and the oil industry coming together. rob mcgregor is cofounder and chief executive officer at lastp -- glasspoint solar. tell us what you guys are doing specifically. glasspoint is the leader in solar for the oil and gas industry. people don't realize how much the energy consumption of the energy industry is. global oil and gas production consumed by the
oil and gas industry itself. that is roughly 9 million barrels of oil equivalent per day, the oil consumption of western europe or all the energy used in residential power in north america, just to give you a sense of scale. carol: that's a lie. --- that's a lot. cory: one of the reasons it is cheaper for them to use, environmental concerns aside. what is happened with solar, since you have dropped the costs down enough, that the oil and gas committees, where oil and gas out of the ground right there, find that building solar is cheaper than using the oil and gas they have right there in the ground? rob: that's exactly right but if it is lower cost than the product you are using, it makes economic sense to use that instead. not justhat occurring in this project but also in saudi arabia, where the nation there -- they are investing very
heavily in renewables, the idea that if we consume less of our own product, it will leave more for export and for future generations. carol: what about the price of oil, though? what is the financial equation that makes sense to do what you are doing? what is oil have to be priced at? : when oil prices are high, it is all about increasing production, and lowering costs is less of a priority. but when oil prices are low as they are now, all the focus is on cost reduction. if you look at a typically heavy oil field, 60% of the cost is fuel purchase. we can reduce the cost of delivering that energy. the focus on cost reduction is actually very good for the deployment of solar in the oil and gas industry. cory: how many deployments do you have of this type? rob: 10 megawatts in production at the moment but 1000 megawatts
under construction right now. carol: i think, you know come back in 2012, u.s. shell is one of your major investors. who is investing in you guys? rob: shell came in in the second round of finance. we brought in the sovereign wealth fund of oman. part of the money, of course, which is nice, but is important in the sense that oman is the leader in enhanced oil recovery not only in the region, but globally. they had less oil than their neighbors. they had to face the question of declining production sooner than everybody else. they develop expertise that is unrivaled anywhere else. that is our strategic partner and strategic investor. ,hat situation you saw in oman where production peak and entered the climb, requiring more energy consumption, is repeating. you see bahrain and nothing heavy oi -- announcing heavy oil projects,
kuwait, and of course, in california, they have been doing heavy oil since the 1960's. you will see increasingly is more heavy oil comes online that the energy demand of the industry is skyrocketing. cory: historically, developing solar in the desert has been a crummy plan because the cost of washing and getting the water there makes that cost ineffective. what is your fix? rod: to give it some contacts, the project we are currently building in oman covers three square kilometers. 2 square kilometers of that is under glass. keeping2 square kilometers -- carol: not easy -- rod: in the middle of nowhere is a major challenge. there is no cities are you have to -- you have to have food, water, doctors from your condition, trucks could almost like a military operation.
the cost of maintenance for cleaning these systems is very, very high. carol: we have about five seconds here. i would love to have you talk about more because it is fascinating to see you and the solar industry kind of working with the major oil companies. rod mcgregor, thank you so much, at glasspoint solar. send it back to you, mark crumpton and eddie leave. -- and betty liu. betty: carol massar there with cory johnson. and i say goodbye here. mark: you say goodbye. coming up in the next hour of "bloomberg market day," crowds in washington cheering pope francis turkey calls for action on climate change. sure, tv has evolved over the years.
a.c.l. is stepping down, saying he is unaware of any wrongdoing on his part, but he says they still need a fresh start. in on theli weighed possible reasons for the vw deception. bob quite possibly what happened vw cases that they found a workaround, and it was only within the u.s. market, because the epa requirements in europe are more lax than they are in the u.s.. rk: more than 11 million cars are involved, and they could costs,llions in repair than firstgger reported, the uss fingerprints of 5.6 million current and former federal employees, contractors, and job applicants were stolen. that is five times the number
expected. two al jazeera journalists in aypt are free following pardon by the country's president. they received prison terms last month for reporting what prosecutors called, quote, "false news." the fate of another behind bars is not known. in greece, they say they will have reforms, agreed to by prime minister alexis tsipras, and they are key to the latest bailout, heaping the country economy afloat, and oil producers in the united states are about to see their credit lines shrink, and just when they need the money the most. is underway, and almost 80% of oil and natural gas producers are expected to see a reduction in the maximum amount they can borrow. the survey says credit lines will be cut by an average of
39%, and an iconic member of the new york yankees dynasty of the dead. and 1960's is yogi berra spent 16 seasons and played in more world season games than anyone else. was the three-time most valuable player and celebrated for his way with words. " may have coined the phrase over"'t over until it is among other things. those are your top stories at this hour. pope francis is in the united states, but he is already diving straight into the whirlwind of american politics, playing to the crowd who gathered to greet him in his automobile, but he weighed on divisive issues from climate change to immigration, and a political reporter was there this morning for the pope's speech. margaret, what is the main take away from what we heard from the pontiff today?
mark, he did not mince words. in terms of climate change, he said this is something the world cannot wait for future generations to tackle and that it has to be done now, and he praised president obama for taking big sex in that direction, including his approach to emissions, and in doing so, although the pope would certainly say that he is not acting as a politician in any way, he is stepping right into a pretty divisive political debate in the u.s. when you listen to what he said at the white house today, you can see exactly what he did. : as he was going to the united states come he told reporters on the plane that it was a mistake to characterize him as a liberal. margaret: that is right, and on that level, he is talking about many of the social issues, whether it is to give miss for women who had abortions in the -- to give forgiveness for
women who had abortions in the past and dealing with annulments. he says he is not changing doctrine, butch establishing the idea that the church can be inclusive and not push people away while holding true to their values, but when it comes to climate change and economic policy, he is, let's say, not in line with most members of the republican party in congress. : as you said, he spoke about climate change, and some see it as a challenge to the united states. let's listen to what he had to say. pope francis: it seems clear to me also that climate change is a that can no longer be left to future generations.
[applause] mark: margaret, in that sense, the pope is trying to bring about a climate change clarion call, if you will, but as you mentioned, those on the right, do they feel the pope is taking sides? on who onit depends the right. there are many are thrilled, including house speaker john boehner, who welcomed him warmly when he goes to address congress, and he does not want to politicize the visit or turn people away. he wants people to talk about his message, but on wall street, hasexample, where the talked about climate change and economic inequality, he is at times called money "the devil's messagesd many of his are open to interpretation in terms of what he means and what he wants, and that is sort of it
areas mark -- sort of it. mark: his ability to have a message that resonates with people and also to have a message, that, as you mentioned, is subject to interpretation. for example, income inequality. the pope has spoken out very strongly on this issue, and it is now part of the 2016 president shall campaign. margaret: a moral issue independent of politics, but for them to want to take advantage of that when they are seizing on to turn outying cry middle-class voters, but at the same time, if you look at the pope us to be as number, in the united states, we have a new bloomberg politics poll that shows the pope is incredibly popular across party lines, with popularity rate.
he is head and shoulders more popular than any of these political leaders right now, so this really does convey across party lines, even as there are republicans who are not thrilled about his engagement on issues like capitalism and the environment. they still like him very much and have an openness and receptiveness to his message. mark: margaret, we have about 30 seconds left. what might we expect from the congress?ress to margaret: it is entirely likely that his approach may be a little bit more strategic. again, i think it is unlikely that he will be calling individuals out, much more likely if he follows the themes that he set forth so far that he the unitedking about states's special role and
special responsibility to make a big impact in the world, whether it involves the plight of refugees, the ways to help immigrants without running afoul of a country's own desires, and, again, obligations to the environment and the obligation to the gift that god has left for the world. he is keenly aware of not wanting his visit to become a little size, and i think we will see that reflected in his remarks tonight -- and i think we will see that. k: we would check up the fast-track to disrupting business. our interview with y combination or sam altman. ♪
mark: welcome back to the "bloomberg market day." i am mark crumpton. there is the techcrunch disrupt conference, and emily chang is there, and she is joined with -- ceo of ytman, tbhhe combinator. emily: thank you for joining us, sam. what has been the best part, and what is the worst part? sam: it is a tough job. is a particularly fun time to be in that place, so we haven't able to scale it up. workest part is we get to with the most incredible entrepreneurs every day.
emily: you have shaken things up a little bit. you have increased the numbers of startups and gotten into hardware and biotech, and you have a new fellowship. where are you seeing the most progress? sam: we think generally that our role or mission is to increase the innovation in the world as and is not even for startups necessarily to do that, and so we see a lot of new ways to increase the innovation of the world. we can fund 10,000 companies over the next decades with a fellowship. that will be a big deal. stuff thate of the is happening in biotechnology is just incredible, and the rules have shifted. look, wek anywhere we can extend the curve of innovation and that is what we want to do. emily: we are in an interesting
position. how do you scale without losing what makes it great? sam: the thing that makes y.c. great is the quality of the people we fund. all of the reasons people want to be a part of our community of alumni, get access to the --ources we have, it is not it is because of the strength of our alumni, so as long as we keep funding the very best people in the world, we can scale out quite a bit. if we were to lower the bar, it would be disaster very quickly. andreessenhave got and another saying not so fast, and i spoke to investors who are saying we are in a bubble. it is going to pop. it is going to burst. there is going to be pain. what do you say? of: they will be right one these years, and they have been wrong for the last 10, but they
will be right again, but i do not care that much. there are going to be great companies formed at the top of the market, at the bottom of the market, and being a great start up investor, we will leave some to the hedge fund guys. i do not care if the s&p as a whole is going up or down. i can't about that one company that is going to be the next airbnb, the next uber. emily: you do not care if we are in a bubble question mark sam: i don't. i think startups should be aware of it. but this is not like a crazy huge funding round. what i care is that startups continue to operate financially. there are going to be great companies formed this year and the year after, no matter what happens. emily: you said it was a collective delusion, the talk of a bubble. since then, we have seen a lot more volatility, volatility in
china. does that give you any pause? be an am not excited to investor, and i have not been. fewer late stage investments myself in the last couple of years than in any period before. emily: really? why? sam: because i think a lot of these things are expensive. i can go on vacation for two years if i want, and so can the other investors who come on your show that talk about a bubble. i thought that even though in general it is really high, this is like a jewel, and all you have to do is get it right on the micro scale. emily: what potential do you see there? i know you made a lot of changes. .ou brought in a new ceo sam: it is growing really, really quickly. it is a place where people feel a lot of loyalty to spend a lot of time on the internet, and i
think the user generated communities have an incredible network. it just gets better as they go. that was really great. emily: so what areas do you want to double down on question mark what areas are you saying, "i don't want to do that right now"? sam: we have been seeing great things in energy and biotech, enterprise software, but, honestly, our next great investment probably will not come from an area. emily: you talked about what the technology community should be doing for the rest of the community. early stage, how do you think a start up should be thinking about this? we just saw with kickstarter where you had a public benefit. sam: i remember with my own startup, you really do not have time for anything else, and you
just figure out a great product that you can really love. i think it is important to think about driving this community forward. combinator has been behind some of the great companies, airbnb, dropbox. taking those out, what are you left with? what do you think about the batting average? sam: well, i mean, sure. you can say that if you take out everybody's winners, then what are you left with, and in particular, the reason you can be so friendly and benevolent as a start up investor is that only your winners matter. a billion dollars or $9 billion plus company. people, ande with so out of the 960 we have already funded, let's say a are already worth a billion dollars or more. i think that is an incredible
batting average create i am delighted with it. emily: president of y com binator, a pleasure. always good to have you back on the show. mark, we will send it back to you. mark: thank you. we appreciate it. time to check in on markets on this first day of fall 2015. matt miller is in the room. matt: the dow was down 100 points at one stage in the trading day, only off 35 now, so clawing back some of the losses. the s&p is unchanged, as is really the nasdaq. take a look at some of the movers here, and really the losers are materials, industrials, and telecom stock, and energy stocks, i should say, as well, down about half of a percent, but material stocks are down 1.4% as a group, and if you take a look at some of the
losers, one of the biggest losers on the s&p 500, freeport macklemore and -- freeport-mcmoran copper, and then the industrial stocks which have tested their august lows. a lot of them individually, but now see the whole group testing the august lows. joy global is off almost every here, and caterpillar down 1.5 percent, and a big, big dow stock, so a big move of 1.5% their weighing on what are the gainers in the dow jones industrial average, and take a look at oil, and you will see the volatility of the day shining through that chart, and this chart goes that really to yesterday evening, when we saw chinese factory data come out, pmi data come out, and it oiluced a negative for yesterday. inventories came out lower than expected, but then a big drop in
: welcome back to the "bloomberg market day." hillary clinton fired another shot at health insurance, talking about mergers. this comes after mrs. clinton announced she would like to halt what she calls excessive profiteering and price gouging by companies. since they wrote a story in this week's "business week" about
turning the epipen into a billion-dollar business, but talk to us about how much politicians are having this impact on companies. cynthia: there was a bit of reaction in stocks, but the financial analysts do not see this as having a major affect on the price and what happens, because ultimately, it is going to take the federal government being able to step in and control drug pricing, and that just has not succeeded so far, and by the time hillary is in office if she is elected and things become law, there is so much time to go, so the feeling in the market right now is that it is not a major issue and will not have an impact on prices. : before you came on during the last break, i mentioned epipen. 40% of their profits print who is in charge? cynthia: these ceo has been instrumental and has been a
driving charge in driving this multifaceted marketing campaign to work both legislatively to get epipen in schools and to become the goto product for the anaphylactic problem, and she is part of the reason the pen has become the goto product. mark: what about raising the prices for drugs? there are drug price increases across the industry, and we saw it this week with the move, and this is not unusual. what mylan has done was pushing up prices over a longer period of time, and that is why it does not go as noticed. mark: over a longer period of time, is that to lessen the impact on patients?
people: i have spoken to who cannot afford it or who have made choices, looking at the $400 out-of-pocket cost, so from the perspective of the actual patients, who need to buy two or three at the pen -- epipens, that is a substantial hit. : and just so the people out there know, it looks like a pen, and you jab at your self with it if you are having some sort of a reaction. its future growth. that is now threatened by another pharmaceutical company. tell us about that. cynthia: it is another approvalr with the fda about a generic. there are some questions about whether or not they will get that, with their product, but if they do, that could become a epipen and foror my lead in terms of there is a competitor that doctors are going to write a prescription
for that is much cheaper if they price it also much cheaper at teva. mark: from the bloomberg terminal, cynthia, thank you. and coming up, after a decade in charge of the wagon, the ceo steps down in the wake of that -- in charge of volkswagen, the ceo steps down in the wake of problem, announcing he would step down, but he also said as far as he was -- knows, no wrongdoing on his part. we will have more on that story when "bloomberg market day" continues in a moment. ♪
the ceo of volkswagen is out after nearly a decade at the helm. what is next for the disgraced auto line? emily: bad news for investors if the fed ignores advice. the federal aviation ministration has granted the nfl permission for takeoff, the permission to use drones. bloomberg world headquarters in new york. i am mark crumpton here with scarlet fu. dominating the news again. scarlet: absolutely, and we will get to that in a moment, but let's start off with equities. a mixed day. the nasdaq is up slightly, ever so slightly, the dow off by 46 points.